Real estate developers bullish on southern markets: Crisil survey

Real estate developers are optimistic of a continued growth in southern markets, particularly in Kerala despite tailwinds amid changing dynamics, a sentiment survey at real estate conclave by Crisil has said.

RERA statistics show that out of 1.35 lakh project registrations in India, Maharashtra leads with 35 per cent, followed by Tamil Nadu (16 per cent) and Gujarat (11 per cent). The southern states — Tamil Nadu, Andhra Pradesh, Kerala, Karnataka and Telangana — collectively hold 34 per cent share, underscoring their importance in the real estate ecosystem, the survey said.

The real estate landscape in southern India has witnessed significant transformation, with markets such as Mysuru, Mangalore, Nellore, Vellore and Amaravati gaining traction even as bigger ones slow down. Around two-thirds of the respondents in the survey are optimistic about the market in Kerala, which constitutes 3 per cent of the total project registrations in southern states. Around half expect growth in Kerala to touch double digits in years to come.

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Ashish Vora, President and Business Head, Crisil Market Intelligence and Analytics said most developers anticipate continued growth in the residential and commercial real estate segments in the southern region. Additionally, Tier 2 and 3 cities in these states, particularly Kerala, are poised for growth, fuelled by rapid urbanisation and affordability.

Senior citizen living communities and built-to-rent (rental housing) are two of the models gaining traction. Close to 75 per cent of respondents envision a moderate expansion in demand for commercial properties in the Kerala real estate market in the next 2-3 years due to an anticipated increase in economic activities and infrastructure development.

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Binaifer Jehani, Business Head – Assessments, Crisil Market Intelligence and Analytics said developers can drive growth by prioritising local market needs. Increasing the supply of affordable housing will help meet demand from local customers.